| History | Business
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of the Murugappa Group
Headquartered in Chennai, the INR 225 Billion Murugappa Group is one of India's leading business conglomerates.
The Group has 28 businesses including eleven listed Companies traded in NSE & BSE. Headquartered in Chennai, the major Companies of the Group include Carborundum Universal Ltd., Cholamandalam Investment and Finance Company Ltd., Cholamandalam MS General Insurance Company Ltd., Coromandel International Ltd., Coromandel Engineering Company Ltd., E.I.D. Parry (India) Ltd., Parry Agro Industries Ltd., Sabero Organics Ltd., Shanthi Gears Ltd., Tube Investments of India Ltd., and Wendt (India) Ltd. Market leaders in served segments including Abrasives, Auto Components, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Bio-products and Nutraceuticals, the Group has forged strong alliances with leading international companies like Groupe Chimique Tunisien, Foskor, Mitsui Sumitomo, Morgan Crucible and Sociedad Química y Minera de Chile (SQM). The Group has a wide geographical presence spanning 13 states in India and 5 continents.
The business has its origins in 1900, when Dewan Bahadur A M Murugappa
Chettiar established a money-lending and banking business in Burma
(now Myanmar), which then spread to Malaysia, Sri Lanka, Indonesia
and Vietnam. In these 100-plus years, it has withstood enormous
vicissitudes, including strategically moving its assets back to
India and restarting from scratch in the 1930s before the Japanese
invasion of Burma in World War II.
Starting with a sandpaper plant, the Group forayed
into making steel safes, and then into manufacturing. It set up
an insurance company, and bought a rubber plantation; making a small
but significant beginning. The rest is history.
Today, it is one of the country's largest industrial houses. The Group turnover crossed the USD 1 billion mark in 2003-04, with an impressive growth of 25 per cent over Rs 4,206 crore in 2002-03, and a 40 per cent jump in profit before tax over the previous year. Consolidated Group turnover for 2004-05 crossed USD 1.44 billion, a growth of 20 per cent over the previous year. In 2005-06, combined turnover increased by 17 per cent to USD 1630 million (Rs 7,340 crore) and net profit (PBT) by 45 per cent to USD 177 million (Rs 800 crore). The Group ended the year 2006-07 with a turnover of Rs 8,446 crore, and profit before tax of Rs 649 crore. The year 2007-08 saw a turnover of Rs 9,852 crore. The Group achieved a turnover of Rs. 13617 crores during 2009-10, Rs 17051 crores in 2010-11 and Rs 22314 crores in 2011-12. The FY 2012-13 saw the Group touching Rs 22466 crores turnover.
Times, Constant Values
Today the Murugappa Group is firmly rooted in its values, and is poised to take on the world. Building on the same business acumen, modern and innovative outlook, as well as vision with which the founder of the Group left his native land to seek his fortune in Burma, the Murugappa Group is on the threshold of the global business arena today, backed by over 100 years of experience in diverse fields, sound traditional values and high ethical standards.
The Group is a market leader in India across a spectrum of products like Abrasives, Auto Components, Cycles, Sugar, Farm Inputs, Fertilisers, Plantations, Bio-products, Nutraceuticals, Industrial chains, power transmission systems and other products. Some of the country's best-known brands like BSA, Hercules and Montra in bicycles, Parry’s sugar, Parrys Spirulina in nutraceuticals, Ballmaster and Ajax in abrasives, Gromor and Paramfos in fertilisers, Chola in Financial Services and many more brands come from the Murugappa Group.
The Group has business relationships with Morgan Crucible Company plc of the UK, Cerdak Pty Ltd of South Africa, Mitsui Sumitomo Insurance Company Ltd of Japan, Foskor Ltd of South Africa, Groupe Chimique Tunisien of Tunisia, Sociedad Química y Minera de Chile (SQM) and other companies across the world.
The Group has grown consistently through its decisive
and visionary response to changing times. Its pioneering efforts,
steadfast commitment to ethical business practices and its dogged
pursuit of new areas to extend its business acumen have brought
in its wake several prestigious national and international awards.
The Group's business philosophy can be summed up in this couplet
from the ancient Indian treatise on wealth creation and governance,
"The fundamental principle
of economic activity is that no man you transact with will lose, then you shall not."
Conducting business by a clear set of values and beliefs,
the Group has observed very high standards of ethics and transparency.
Its belief in organisational renewal has allowed the Group to adapt
itself to changing economic contexts and grow from strength to strength.
The Management Development Institute (IMD) of Lausanne, Switzerland,
conferred the 'IMD Distinguished Family Business Award' on the Group
Leap of Faith
The Murugappa Group has drawn from its rich heritage to carry out
organisational and entrepreneurial changes through transparency,
and without operational disruption. The family-managed Group successfully
transitioned to a professionally managed corporate house, engaging
Arthur D Little for restructuring and succession plans, following
the demise of M V Arunachalam (1929-96), which brought the leadership
to the older A M M Arunachalam, who passed away in 1999.
It was in 1999 that M V Subbiah decided to step
down, bring in an external chairman for the Group, and let the
family take advisory positions. The Murugappa Corporate Board was
formed and N S Raghavan, a professional, was appointed as Chairman.
On his retirement in 2001, P S Pai took over as Executive Chairman.
During Pai's tenure the Group went through a period of learning and
growth. On completion of his tenure, M A Alagappan, took over as
Executive Chairman in October 2006 and A Vellayan as its
Vice-Chairman and Director-Strategy. A Vellayan succeeded M A
Alagappan as the Executive Chairman and M M Murugappan the Vice
Chairman on November 1, 2009.
Each successive generation has not only strengthened
existing businesses but has developed new ones. It has developed
unmatched expertise in turning around sick businesses in the shortest
possible time following acquisition. The Group manages the evolution
of its businesses and governance structures consciously. As a result,
the Group's business portfolio is diverse and dynamic.
Dedicated employees drive the Group. The Murugappa
Group has always believed in the welfare of its employees. Each
company provides excellent opportunities for learning and growth
to all its employees.
to the Community
The Group founders were aware of the importance and necessity of
corporate contribution to the welfare of the community they were
operating in, from the time they began their journey in 1924. The
AMM Trust was formed to set up and run hospitals and schools in
Chennai and Pallathur, the native place of the founders.
Murugappa Group continues to build on the culture of philanthropy
initiated by its founder. Social commitment has always been the
cornerstone of the group's ethos and it has been at the forefront
of eco-conservation, public health, and education in the communities
where its companies operate, since 1957.
It runs four schools, a polytechnic college and four
hospitals. Besides, the group runs a research and development centre
for rural development, the Sri AM Murugappa Chettiar Research Centre
(MCRC), which has been designing simple, cost-effective technologies
for local artisans since 1977.
The Group has scaled each pinnacle consistently through
its decisive and visionary response to changing times. Its pioneering
efforts, steadfast commitment to ethical business practices and
its dogged pursuit of new areas to extend its business acumen have
brought unprecedented success and several prestigious national and
international awards. But there is no stopping for the Murugappa
Group; the journey is still on, in search of scaling newer heights
and finding greener pastures - beyond the horizon.